Like CHCH in Hamilton (another station that used to form part of Canwest’s E! secondary network), CHEK has abandoned the conventional television model used by the big networks – spending millions on hot primetime U.S. programming and using part of the profits to subsidize a minimum amount of local newscasts. Instead, they’re doing the opposite, expanding local news and going for cheaper programming in primetime.
The rest of the Canadian television industry is keeping a close eye on these stations. If the business model turns out to be successful, it will be quickly replicated across the country, much to the delight of unions and journalists. If it fails (which is more likely), it won’t be repeated again and the television news death spiral will only continue to worsen.
Employees and fans of CHCH in Hamilton, Ont., began a campaign to save the station, and one of the ideas floating around was to have the employees and community pitch in to buy the station from Canwest and run it themselves.
Turns out that wasn’t necessary. In June, a broadcaster most had never heard of called Channel Zero announced it was going to buy CHCH and CJNT in Montreal. It also promised that all the jobs would be kept and the station would increase its focus on local news. That sale got CRTC approval and became final just before the Aug. 31 deadline set by Canwest (based on the end dates of licenses for the stations).
More recently, when CHEK-TV in Victoria found out it wasn’t going to be saved and would be closed down along with CHCA in Red Deer, Alta., staff there began a similar campaign. It actually got to the stage of submitting a $2.5 million bid to Canwest to buy the station, just a week before it was to be shut down. The money would come from staff and local investors who were committed to having a local voice on Vancouver Island.
The deal was rejected by Canwest as being insufficient. The sale price of the station wasn’t the issue, they said, but investors would need to have enough money (about twice the amount offered) to cover early losses, which would be substantial because the station had no advertising sold after Aug. 31.
Over that last weekend of August, it looked like CHEK was gone for good. CHCA shut down on Monday morning, and CHEK was scheduled to go out after some special programming remembering the 53-year history of the station.
(The fifth E! station, CHBC Kelowna, was brought into the Global television network, an option not available to either CHEK or CHCA because of license restrictions that prevented them from carrying the same programming as Global stations in Vancouver and Calgary, respectively. It will operate as Global Okanagan, and with 11 fewer employees.)
But CHEK’s employees weren’t done. They submitted a revised bid, and Canwest agreed to keep the station on life support for an extra day. And another. And a few more.
The news officially came just after the close of business on Friday, in the form of an internal memo to employees and a press release: Canwest had agreed to sell CHEK-TV to a group of local investors, led by the station’s employees.
The actual price was nominal (the Globe and Mail has it at $2), but the important part is that the station’s new owners would pay for any losses suffered while the station was awaiting CRTC approval of the sale.
That approval should come quickly, if the Channel Zero case is any indication. The move is a win-win-win. It makes Canwest look good (or at least less bad) compared to what would happen if they shut the station down (in all, Canwest says it saved 90% of the almost 300 employees at the five stations). It saves the jobs of CHEK’s 45 employees (they’re really happy about that part), and it keeps a local television station in Victoria (CTV’s CIVI-TV, part of the A network, is the only other station indigenous to Vancouver Island).
But the tough part of this story is just beginning.
People buy money-losing TV stations with optimistic business plans only to see them go down the drain. And employees often think they can do a better job running a company if they just got those know-nothing managers out of the way.
The investors behind the CHEK bid say they have a solid business plan. Now we’ll see if they can make it work. If they do, we could see lots of other small-market money-losing stations across the country try the same thing (or we’d see Canwest and CTV buy them back and change all of their stations to fit that working business model). If they don’t, it’ll make others think twice before trying a similar move.
I hope CHEK succeeds. I don’t think the odds are in its favour, but I applaud them for trying.
This week has a lot of changes for television both local and nationally. Two main reasons for this: it’s September and the fall season is starting, plus CRTC broadcast licenses for conventional television stations end on Aug. 31.
MuchMusic’s digital specialty channels MuchVibe, MuchLOUD, MuchMoreRetro, PunchMuch go commercial-free. MuchMusic and MuchMoreMusic – which still have enough viewers to sell commercials – continue to air ads, as will programs that are simulcasted on the digital specialty channels and Much or MMM.
The BBM ratings system switches to the “Personal People Meter“, a device that had been tested in the Montreal market, to allow nationwide monitoring of what people watch and listen to on TV and radio. The PPM is a pager-like device worn by sample audiences, and replaces the less accurate diaries that relied on self-reporting.
8am (6am in Red Deer): CHCA, an E! network station in Red Deer, Alta., goes off the air. (UPDATE: Its last newscast, from last Friday, has been uploaded to YouTube in eight parts)
8:30am (5:30am in Kelowna): CHBC, a former E! network station in Kelowna, B.C., is rebranded “Global Okanagan” as the E! network shuts down.
Tomorrow, Sept. 1
12am: The CRTC begins billing cable and satellite companies 1.5% of their revenues for a Local Programming Improvement Fund, to help small-market television stations. Bell and Shaw, Canada’s satellite providers, have responded by adding a 1.5% fee to consumers’ bills beginning today. Videotron, Quebec’s main cable provider, hasn’t decided to follow suit yet.
At the same time, the CRTC lifts the cap on the amount of advertising conventional television stations can air. It had previously been at 15 minutes per hour. The CRTC believes that the market will self-regulate the amount of advertising (after all, a station with too many ads is going to lose viewers).
1am (10pm in Victoria): CHEK-TV in Victoria goes off the air. See below.
6am: As conventional broadcast stations across the country (at least the ones that are part of large networks like Global, CTV, CityTV and TVA) get new one-year licenses, new local programming requirements come into effect. They require 7 hours of original programming for small markets and 14 hours for large markets (the latter includes Montreal on both the anglo and franco side). TVA’s local programming numbers are defined on a case-by-case basis: 18 hours a week for Quebec City and 5 hours a week for Rimouski, Chicoutimi and Sherbrooke. TQS, because it got special consideration from the CRTC after going bankrupt, isn’t affected by these changes.
6pm: Global Quebec CKMI becomes Global Montreal with a rebranded evening newscast after a CRTC decision this summer allowed them to relicense and accept local advertising. Global Ontario is similarly changing to Global Toronto.
Wednesday, Sept. 2
1am (10pm in Victoria): CHEK-TV in Victoria goes off the air. See below.
It’s an idea that seems to have gotten a lot of traction recently as the traditional media business model collapses and front-line journalists blame the problems mainly on management excess and poor business decisions: If the union and/or its members bought the company, they could solve all those problems and turn it into a profit-making enterprise.
At CHEK in Victoria, they weren’t so lucky. Canwest couldn’t find a buyer for it, nor could they convert it into a Global station because a condition of license prevents duplication with Vancouver’s CHAN. So the plan is to have it shut down by the end of August.
Last week comes word that employees at CHEK (there are about 45 in all) are pooling their money in a bid to buy the station before it gets shut down. They’ve pledged more than $500,000 and are hoping to present the formal offer soon. That might be too late for Canwest though, since these kinds of transactions take months and there’s a ticking clock.
If that fails, there’s always the Facebook petition route. Two groups have been setup, the first with over 6,000 members.
CHEK Victoria and CHCA Red Deer (Alta.) will close on Aug. 31. CHEK couldn’t be turned into a Global station because of a CRTC rule that it not duplicate CHAN in Vancouver. CHCA is right between Calgary and Edmonton, both of which have Global stations.